Secondary bond market

The Investment Company Institute reported $755 million of outflows from muni bond mutual funds in the week ending August 24 compared to $320 million of inflows the previous week.

After underperforming USTs last week, "munis have given up their earlier performance advantage for August with both asset classes currently earning virtually the same negative returns," said Jeff Lipton, managing director of credit research at Oppenheimer Inc.

Fed Chair Jerome Powell's message on rates last week combined with seasonal factors to give the market a "weird" vibe this week, one trader said.

Investors will be greeted Monday with decreased supply with the new-issue calendar estimated at $5.882 billion, down from total sales of $6.134 billion in the week of Aug. 22.

Outflows from municipal bond mutual funds continued as investors pulled $1.180 billion out of funds in the latest week, according to Refinitiv Lipper data.

The Investment Company Institute reported $230 million of inflows into muni bond mutual funds in the week ending August 17. ETFs see second week of outflows.

Join Peter O'Neill, Director and Senior Fixed Income Portfolio Manager, at Bank of America, and Blake Lynch, Head of Business Development, IMTC, as they discuss the role of separately managed accounts in the muni market with The Bond Buyer's Lynne Funk.

Don't expect much new information to come from Jackson Hole this year analysts say, as the data-dependent FOMC will rely on incoming economic numbers in September to decide the proper size rate hike.

Losses for August climbed last week, with month-to-date returns in the red at negative 1.40% on the Bloomberg muni index, high-yield seeing 0.99% losses, taxables at 2.01% losses and the impact index losing 1.70%.

Investors will be greeted Monday with a decrease in supply with the new-issue calendar estimated at $6.711 billion, down from total sales of $10.318 billion.